View full sizeBrent Wojahn/The OregonianKathy Mendez, who accuses a Jesuit priest of sexually abusing her at a boarding school in Omak, Wash., in the mid-1960s, walks to a bankruptcy hearing in downtown Portland with her lawyer, Blaine Tamaki.

A U.S. bankruptcy judge in Portland today said she would confirm Chapter 11 reorganization of the region's Jesuits, paving the way for 534 creditors to begin receiving payments this summer for abuse suffered at the hands of Jesuit clergy.

The Portland-based Society of Jesus Oregon Province -- the formal name of the Jesuits in Oregon, Washington, Montana, Idaho and Alaska -- is expected in early August to put $48.1 million in a settlement trust for creditors. Later this summer, insurers for the Oregon Province will send payments to the trust of nearly $120 million, according to attorneys for the parties.

A last-minute objection to the bankruptcy plan by a lawyer for four high schools -- Beaverton's Jesuit High, Tacoma's Bellarmine Preparatory, Spokane's Gonzaga Preparatory and Seattle Preparatory -- nearly put a halt to today's long-awaited conclusion to the bankruptcy plan.

A lawyer for the schools wanted an agreement written into the plan that would release them from any legal claim that they were part of the Oregon Province. The province and the committee of creditors appointed in the case had recently reached such an agreement with Seattle University. However, the creditors committee argued against the high schools getting the same deal.

Lawyers huddled privately during a break in today's proceedings to reach a compromise: the settlement trust was given a deadline of up to nine months to commence any litigation against the high schools. The trust would also be required to file one lawsuit, and it would be limited to a pair of Portland venues: U.S. District Court or U.S. Bankruptcy Court.

Kathy Mendez, one of 525 creditors who accused the region's Jesuit priests of sexual abuse, sat in on Thursday's bankruptcy hearing with her lawyer, Blaine Tamaki, of Yakima, Wash. Tamaki said his client was relieved that the long, emotional process of negotiating a settlement, commenced by the Feb. 17, 2009, bankruptcy filing, had come to an end.

"It was time to get this put to rest," Tamaki said. "Because there's a lot of attorneys' fees being charged, and it's time to put a stop to the legal fees and get the claimants their money."

Lawyers have estimated they will receive roughly 33 percent to 40 percent of the $167.8 million settlement from the Jesuits, an order of the Catholic Church.

Mendez, a 56-year-old resident of Wapato, Wash., accused Father John Morse of sexually abusing her at St. Mary's Mission boarding school in Omak, Wash., in the mid-1960s. Before Thursday's hearing, she described the day at age 11 when she got into trouble and was sent to Morse, the school's principal, for discipline. He took her into his office and molested her, she said.

Tamaki said about 60 people claim Morse sexually abused them during the 1960s. The priest, now living in a Jesuit home in eastern Washington, abused boys and girls, ages 5 to 15, in violations ranging from fondling to rape, he said.

"He would bring in students into his principal's office and sexually molest them on a systematic and routine basis," Tamaki said. "He was there for at least 6 to 8 years."

The senior official of the Oregon Province, the Very Rev. Patrick Lee, apologized in a news release to the victims of abuse.

"On behalf of the Oregon Province, I want to express our most sincere sorrow for the pain and hurt caused by the actions of a few men who did not live up to their vows," Lee said. "We will continue to pray for all those who are hurting and hope that today's announcement brings all involved one-step closer to the lasting healing they so richly deserve."

Judge Elizabeth L. Perris announced her decision to confirm the Jesuits' bankruptcy plan during a two-hour hearing in her downtown Portland courtroom. She lauded a room full of lawyers -- and those taking part in the proceedings by speakerphone -- for the marathon of negotiations and mediation that resulted in the agreement.

Perris pointed out that the bankruptcy plan wasn't a cure-all for the harm done to claimants. But, she said, "It's the best we've got."